Bids get matched(slightly raised) - XRP to BTC

[jaycee1967]

Not sure if this is a bug or a malicious Bot or trader, but yesterday every bid that I put in (many bids) was matched(slightly raised). I can't be bothered testing it too much today but the same appears to be happening.

Yesterday it was (e.g.) : I bid for 0.5 btc @ 13000 Mr X bids for 0.33 btc @13000.01

So I try 0.5 btc @ 13100 and Mr X bids for 0.33 @ 13100.01

And on, and on, and on, and on .............

Today I think it's higher

So is this a bug - in which case I claim my pot of gold in XRP terms - or is this some weird Bot or trader ensuring a price hike?

Either way, it bodes badly for XRP

[jaycee1967]

Forgot to say, the counter bid comes in within 30 seconds

[JoelKatz]

Trading is effectively an auction with the trade going to whoever is willing to pay the highest price. If you don't want to alternate raising prices, bid the highest price you're willing to pay in the first place. If the bot raises you, then the bot is willing to pay more than you are and deserves the top spot. If the bot drops out, then you will get the trade.

[jaycee1967]

"Trading is effectively an auction with the trade going to whoever is willing to pay the highest price."

Well, yes, but if you read what I wrote, I said that all the bids made were countered within seconds and bettered by a fraction of a number. So the only way to buy would be to pay the asking price. So it's not really an auction at all. If the asking price is 15000 and the highest bid 12000, then I would hope to be able to meet in the middle rather than have an automated response Bot (or whatever) outbidding me every second.

But thanks for the wise words.

I was still not convinced it was a Bot. But given your response, I'll assume it is.

[JoelKatz]

@jaycee1967 That's how an auction works. One party makes a bid and then the other party either raises their bid or drops out.

In your example, if you want to meet in the middle, place an offer in the middle, say 13,500. If the bot bids 13,501, the spread is now 13,501-15,000 and you've made the spread better for everyone and forced the bot to pay 13,501 instead of 12,000. The middle is now 14,250, which you can either raise your bid to or not at your option.

This is the normal, healthy behavior of a market.

[cryptojoe]

Yeah that bot is a persistent bugger. Joel, a smaller spread is not necessarily better for everyone. That unfeeling bot is erasing all the interesting arbitrage opportunities across the snapswap and bitstamp platforms. Drats! It's working both camps. Probably some market makers. i know snapswap was recruiting on their website.

[jaycee1967]

Joel, I wouldn't call it healthy at all. The Bot (or programme) responds to every bid made with a higher bid - it is not hovering around with annoying little bids. The upshot is that I can only buy BTC by matching the price of the best sell offer. The principle of "auction" exists only for the Bot - and since the Bot seems to just pay whatever is asked (if pushed), then "auction" is probably not even the correct term for it.

For "fun", and when there is a large spread, you can take the Bot up and make it buy BTC at, say, 2000 XRP per BTC higher than the highest bid. You can do this by bidding for 0.00000X @ P (you get it), and the Bot responds with its bid for 0.33 @ P - which appears to have been upped to about 0.7 today.

It's a poor state of affairs, especially given the infancy of the project and the promise it has. It's also poor that you would call such behaviour "healthy". The market is stacked, which is not exactly my idea of free market principles.

But I'll take this over to the Ripple discussion forum because as you've made clear, this is not a Bug issue.

[JoelKatz]

@jaycee1967 If the bot is willing to pay more than you are, then it should have the tip of the order book. That's how an order book works. This is how a healthy market works -- the one willing to pay the most get the deal, paying as much as other participants make them pay. I'd be happy to discuss it with you on the forum, but this is exactly correct behavior. If you are willing to pay more than the bot is willing to pay, do so, and you will get the trade. If you are not willing to pay more, then you should not get the trade.

[jaycee1967]

Okay, so let's just say that the Bot is not conscious of what it is doing, and we do not have person A and person B making reasoned choices as to how high to go.

We have a programme that is running the show for the good of whatever the programmer believes is good (for him or her or them).

I would class it as malicious - people like transparency, and Ripple will never be mainstream if this continues.

[JoelKatz]

@jaycee1967 If the bot is not making reasoned choices about how high to go, it's giving money away by overpaying, offering a generous gift to anyone who chooses to take it. If you believe the bot is willing to pay too much for something, take it up on its offer and profit. The bot is willing to pay more than you are, so it should be getting the business, not you. The way a healthy exchange works is this -- the one willing to pay the most gets the trade, with the price set by what other competitors make them pay. If the bot is willing to pay more than you, it should get the trade. You get to set how much it has to pay though. There must be some upper limit on what the bot is willing to pay -- if nothing else, its owners don't have infinite funds -- if you are willing to pay more than that, you will get the trade.

[jaycee1967]

Take it up on its offer to overpay for BTC .... but if it continues on its merry path, than the price of XRP deflates, so not much of a chance for profit unless you know where the Bot will go.

So I'll take myself over to Cryptsy where I can make a reasoned decision about which coin is about to pump and which is about to dump

I'm someone with 20000 XRP - I paid about 1.3 BTC for that, so no issues with me about losing ---- I'll hang onto the XRP in case things turn the other way, if not then I've lost hardly anything and had a good time watching the handiwork of the world's least subtle Bot

But I guess the guys that bought in at 6000 or so, and were not able to sell and buy back at better rates, might be a bit sore that their investment is crashing at the hands of a maverick Bot :-)

Ripple was to be mainstream (I thought), and this is way from mainstream in my eyes.

Anyway, no point in whining, and I guess the new low prices might attract a few more people into buying XRP ...